From outsourcing to operations, technology will continue to drive every aspect of HR.
By Hans-Petter Mellerud
Looking back 20 years ago at the human resources profession, one can get a profound sense of what those earlier days were all about. Of course, hindsight is 20/20.
It was a universe of spreadsheets, disparate point-to-point systems, and a ton of manual administrative effort to stay on top of everything that came through the HR doors—whether via phone calls, rudimentary email applications, or face-to-face encounters with anyone and everyone employed or applying.
HR was at the centre of a confluence of demands, including supporting corporate objectives, regulatory compliance measures, and the expectations of both management and staff. A tall order, to say the least, that reached rather epic proportions when adding in daily responsibilities such as recruiting, onboarding, training, compensation and benefits, payroll processing, performance management, expense reporting and monitoring, policymaking, and whatever else happened to be deemed “an HR thing.”
So, what’s different today? Perhaps the adage “the more things change, the more they stay the same” comes to mind.
If anything, the demands listed above are even greater. Plus, HR leaders are now faced with even more opportunity and higher risk because they are—or should be—much more strategically aligned and engaged at the most senior levels of any enterprise.
HR and IT—Match Made in Heaven?
What’s even more intriguing in some ways is how intrinsic HR leaders have become to the organisation’s IT direction. Technology is where a lot of success will begin and end relative to almost all aspects of the increasingly virtual, evolving HR function. As the mobility dimension unfolds within every modern-day company’s operations, that digital handwriting on the wall should be a call to HR action, if it isn’t already.
The facts are undeniable, but companies are still struggling to keep up. Too many organisations are either not giving serious consideration to fully modernising their HR functions, or they’re just now figuring out they have no choice. In addition, those that are already on digital courses often find themselves slipping.
According to a report by industry analyst Everest Group, failure to upgrade to operating models that enable an enterprise’s digital strategies is often to blame. In fact, as many as 78 per cent of enterprises today are unable to scale their digital transformation to a level that can drive sustainable success and achieve the desired return on investment.
The technological challenges include the fact that remote workers are literally everywhere now, and mobile demands and security threats must be addressed from the inside out. Collaboration with oustourcing partners will be ubiquitous in 2020 as in-house expertise gives way to external specialisation—and the need to devote more internal resources and focus to the enterprise’s current and planned core competencies as well as long-term fiscal aspirations.
The new demands naturally warrant new types of solutions and controls in addition to proven best practices. Many HR and IT organisations are not prepared to do it alone, nor do they need to, as cloud computing flexibility and cost advantages increasingly take hold in outsourcing arrangements worldwide.
In a recent report, Cloud & Multi-Process HR Services: Journey to the Cloud and Beyond, market analyst firm Nelson Hall observes that the multi-process HR services market is actually declining as on-premise deals are superseded by the adoption of cloud-based HCM platforms.
According to Nelson Hall, the primary benefits of outsourcing human capital management (HCM) solutions and best practices guidance come down to:
- depth of vendors’ technical and functional knowledge and skills;
- reduced total cost of ownership; and
- process improvement.
Elevating the Workplace
As HCM adoption rises in the cloud and routine administrative tasks become more automated and efficient, HR leaders are in an inherently better position to elevate their strategic contributions. The movement and convenience are encompassed in dynamic shared-services models that will be widely recognised as the backbone of the HR function in the years ahead.
What’s also changing dramatically are the social and business expectations of company leaders and the most connected workforce the planet has ever seen. Personal convictions and causes are increasingly morphing and integrating with career pursuits, and the lines are blurring further as people apply consumer-based expectations to their work life. Both employees and employers increasingly want the same productivity advantages and convenience that they enjoy with personal devices to transcend into the workplace.
Unlike the cloudy vision HR faced looking at the future 20 years ago, what is happening today sheds clear light on the next two years and beyond. HR in 2020 will be enmeshed in just about all of the most innovative aspects of technological advantage imaginable. In particular, Everest Group said in Zalaris’ HR 2020 report that the cloud, mobility, analytics, natural language processing, robotic process automation, and machine learning will have dramatic implications and value for the HR function.
Time is Money
There’s no sense in delaying the types of advances today’s technologies enable in conjunction with proven HR best practices. As we head into 2020, HCM solutions will be the foundation that enables a future where:
- shared services will continue to grow, increasing efficiency and cutting cloud costs;
- automation will create more strategic HR functions—not fewer overall jobs;
- advances in analytics will drastically improve recruiting, onboarding, training, and more; and
- BPO value, design thinking, mobile, and security will drive HR decision-making.
These are sweeping changes and some of the top trends to watch as transformative technologies and processes continue to enter the mainstream. They are also the factors to give utmost consideration in what is the most pivotal juncture in the past two decades of HR history—and the HCM bridge that will take the profession forward in the next 20 years.
Hans-Petter Mellerud is the founder and CEO of Zalaris.